'Reasonably Valued'
"The market looks at worst reasonably valued, at best downright cheap," Bernstein said in an interview with Robert Huebscher, founder and CEO of the Advisor Perspectives website, that was published yesterday.
Both price-earnings indicators look "better than normal" after taking interest rates into account, he said. The average yield on 10-year Treasury notes has fallen to 2.01 percent this year from 2.76 percent for all of last year, according to data compiled by Bloomberg.
P/E ratios are poised to rise, he said during the April 30 interview, as economic weakness in Europe and slower growth in emerging markets spur demand for U.S. assets.
"People are underestimating the risk outside the U.S. and overestimating the risk inside it," said Bernstein, based in New York. "Over the next several years, there is going to be a reevaluation of those risks, and we should get higher multiples in the U.S."